Banks are competitive institutions. To compete they must innovate and in IT terms that means bringing new products and rich applications to market faster than competitors. Getting those products into our hands in tried and tested form gets tougher every day as our platform choices expand to include browsers, tablets, smartphones etc. Like it or not, in today’s world where customer relationships just aren’t as sticky they used to be, banks do need to keep us happy or we’ll simply take our business elsewhere.

Keeping up with that rate of change is no mean task for a young software start-up, but it’s one heck of a challenge for a highly regulated corporate in Canary Wharf or Wall Street. The big banks’ technology teams are responding; adopting agile development methodologies and reducing application release cycles. While this is slashing time to market for new products, it’s creating new risk and additional cost; most specifically in the areas of process, control, audit and, dare I mention it, backup, recovery and roll-back for when things go sideways – which they do.

The pure velocity of such a tech savvy global market challenges the regulators in much the same way as the banks themselves. While at face value it’s easy to see regulation as safe, solid and static, the reality is that regulations continually evolve to keep pace with changes in the technology world.  So, given the criticality of technology to core banking operations, is IT directly in the regulators’ sights? You bet it is! To stand behind that statement let’s look at the UK regulatory climate and the FSA’s actions earlier this year.

IT under the regulatory spotlight

Even spectacular Olympic successes in 2012 couldn’t keep the news of critical IT outages at UK banks off the front pages. In response the FSA made a ground breaking move to ensure that top executives across UK banks take full and personal accountability for the IT processes and systems that run their business. In a letter to Chairmen no less, they called on banks’ boards to “ensure resilience of critical infrastructure and processes and to outline contingency plans for restoration of services in the event of a failure”.  Kind of wordy I know; but you get the gist. They also want the names of the senior executives responsible for addressing their concerns.

Compliant and agile

In this context, it is critical to recognise the need for balance between evolving legislation and growing IT demands.  Indeed, banks must manage the trade off between consultation and legislation processes and the need to remain agile and flexible enough to safeguard what’s arguably the fastest moving market on the planet.

There is also clearly a delicate balance to be struck between getting product to market quicker using agile development and implementing the controls required to release and deploy new applications reliably; and without incurring the wrath of customers and regulators alike.

So what can a CIO of a major bank do who wants to keep his business and regulatory needs in perfect balance? They must look to harmonise IT and compliance by automating the complex and fragile application delivery process.

The CIO’s need for agile delivery is a ‘must have’ for the business to remain competitive while the compliance officer’s need for repeatability, process and control is equally imperative in keeping the regulator happy. Solutions for application release automation are helping financial organizations across the globe meet these challenges and in my opinion there’s no better time to open your mind to exploiting them.